In order to renew the dollar's life, the United States has recently started to make trouble again.
At the beginning, the United States set its sights on the mainland, hoping to harvest the mainland to maintain the so-called dollar hegemony.
But after two years of raising interest rates by the dollar, it was found that there was no way to help the mainland at all.
And Europe, Asia, South America, Africa and other regions are almost the same. To this end, the United States has set its sights on Japan.
All along, many of the allies cultivated by the United States have had only one purpose, and that is to serve its own hegemonism.
The Plaza Accord of the last century is a very typical example.
In order to solve the huge trade deficit of the United States, the finance ministers and bank presidents of the United States, Japan, the Federal Republic of Germany, France, and the United Kingdom signed the Plaza Accord at the Plaza Hotel in New York.
After that, the five countries began to sell a large number of dollars in the international foreign exchange market, thus inducing market investors to also sell frenzy. This eventually led to a significant depreciation of the dollar.
After that, the value of Japan's currency rose every year, eventually leading to a severe economic bubble that collapsed five years later, leading to the collapse of the Japanese economy, a period known as the "Lost Decade".
Now the dollar's continuous interest rate hike is a very important purpose, and it is also to stimulate China's real estate bubble, but it can't shake us at all.
So, I began to turn my head to Japan.
The danger we often talk about is actually the surge in U.S. bond interest after the U.S. dollar interest rate hike. The interest paid annually alone already exceeds U.S. military spending.
But Japan has always been a chicken thief, and interest rates have been zero for a long time. They only need to "tear down the east wall and make up the west wall", and they don't have to pay any interest.
It was only in the last two years that Japan raised interest rates by a symbolic 0.1%. However, despite their caution, they are still unable to withstand the changes brought about by the international situation.
In the wake of the Russia-Ukraine conflict, international raw material prices have been rising. In order to cater to the West, Japan has imposed sanctions on Russia in various ways.
This has also led to the loss of Japan's nearest energy source. In the end, oil and gas can only be purchased at a price of 50% higher than before.
In 2023, Japan's manufacturing industry will also be hit hard. This has also been discovered by those keen international capital.
As the saying goes, "take advantage of his illness to kill him", all capital intends to harvest a wave of leeks when Japan is drunk and weak.
On April 25, the yen and the dollar were trading at a record high of 155.64:1 since 1987.
Immediately afterwards, Buffett made a move and began to issue bonds in Japan.
So, what exactly does Warren Buffett want to do? According to the analysis of professionals, Buffett's move is to take advantage of the tide of the dollar to harvest profits.
Warren Buffett once issued bonds totaling 630 billion yen in Japan as collateral against dollar assets.
But after the bond was issued, Buffett repatriated the funds back to the United States. Then take advantage of the interest rate differential between the two countries to profit up to 5 pips.
Now that the yen has depreciated sharply, Warren Buffett's previous debt of 630 billion yen can be paid off with just over half of the dollar.
To sum up, it is Buffett's way of borrowing yen for dollars, the yen plummets, and Buffett sells dollars to exchange for yen to pay off debts.
All of the above will inevitably lead to a continuous depreciation of the yen, leading to a collapse.
The only thing Japan can do right now is to hope that the Fed will cut interest rates. But for now, that's not possible. This is because the United States has always harmed others and benefited itself.
All allies do not usually "respect each other as guests", but when the time comes, the United States will definitely be the first to pull these allies out as cannon fodder in order to maintain its hegemonic status.
Reference: "Bloomberg: Warren Buffett's Company Plans to Issue Yen Bonds Again" Xinhua News Agency International
"The yen exchange rate against the US dollar hit a 34-year low, Trump spoke out to attack Japan and pull China" Global Network News on April 24
"Record level! Short yen positions hint at increased likelihood of a sharp rebound in the yen" Hexun.com, April 23